Narcissism, Over-Optimism, Fear, Anger, and Depression: The Interior Lives of Corporate Leaders

Abstract

The downfall of corporations can often be traced to the personality traits of top corporate leaders. This article examines five such traits, and finds them in abundance in both successful and failed leaders. After looking at the evidence in the lives of recent CEOs - Bill Gates, Jack Welch, Michael Eisner, Martha Stewart, Sandy Weill, Carly Fiorina, and Conrad Black, among others - the article surveys the consequences of these traits in a business environment. Four of the five traits (the exception is depression) may have positive consequences for an organization. All five of them may generate very harmful consequences. These include hyper-deference, reluctance to provide truthful information to the boss, bullying and intimidation up and down the chain of command, and constantly-shifting corporate priorities. These problems may be compounded when the CEO suffers multiple pathologies (e.g., a CEO who is narcissistic, over-optimistic, and angry). Problems may also arise when multiple leaders reinforce each other's pathologies. The article concludes with some prescriptions for board action.

Keywords: Chief Executive Officers, Narcissism, Over-Optimism, Corporate Governance

JEL Classification: G30, G34, M14